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MOB RULE

Extortion has become a way of life in the new Russia

MOB RULE
JAMES DEACONMay301994

MOB RULE

Extortion has become a way of life in the new Russia

JAMES DEACONMay301994

MOB RULE

WORLD

Extortion has become a way of life in the new Russia

In 1993, Sergei Skorochkin finally gave in to the mobsters who were demanding a $22,000 payment. The operator of several food outlets and a distillery in Zaraysk, 160 km southwest of Moscow, Skorochkin knew only too well that refusing to pay the protection money could cost him his life. Said Skorochkin: “Of course, I paid them of.”

Skorochkin is not the only person reluctantly keeping bad company. Extortion has become a way of life in Moscow and other centres. And his problems did not end after he started paying off the thugs. Eventually tiring of the mobsters’ constant demands, the 33-year-old businessman told his story to the police—only to hear that there was not enough evidence to lay charges against the extortionists. Not long af-

ter, events took a violent turn. According to Skorochkin, seven armed men confronted him near his Zaraysk home on May 1. In the ensuing struggle, Skorochkin says, he seized a Kalishnikov rifle from one of the assailants. When another racketeer fired at him with a

ASSIGNMENT

MALCOLM GRAY IN MOSCOW

pistol, he shot back, killing the man. Now a member of the Russian legislature, Skorochkin insists that he acted in self-defence— and to date, police and his parliamentary colleagues have accepted his account of the

confrontation. In the meantime, he stays close to home as he awaits the outcome of the police investigation. Said Skorochkin: “My friends are guarding me against gangsters.” Criminals, seemingly, are everywhere. They have even extended their power and influence from the back streets to government offices, using a combination of threats, violence and payoffs to officials. By some accounts, the ranks of the Russian mafia now include some 200 highly disciplined crime syndicates and as many as 3,500 less formal groups. And not all of their victims live in Russia: highly paid Russian athletes who work abroad, including several National Hockey League stars, have also been targeted for extortion. Bankrolled by the ill-gotten riches they have collected at home, Russian mobsters are peddling everything from narcotics to stolen components for nuclear weapons. Concluded a recent report by the Moscowbased Analytic Centre for Socio-economic Policy, a government-funded think-tank: “In Western Europe and the U.S.A., organized crime controls only purely criminal spheres such as prostitution, drugs and gambling. In Russia, organized crime controls everything.”

The centre’s director, Pyotor Filippov, sketches a bleak picture of Russian crime. He says that 80 per cent of stores, restaurants and other companies in Russia’s emerging private sector pay protection money to racketeers—in some cases, as much as 20 per cent of their revenues. Filippov’s anticrime experts estimate that the 150 most powerful gangs wield effective control over a combined 40,000 private and state-owned companies, including most of the country’s 2,000 commercial banks. According to Western intelligence agencies, Russia’s gangsters have also helped Colombian drug barons set up cocaine distribution networks linking South America and Eastern Europe. From the other direction, the gangs transport opium and heroin from Afghanistan and Central Asia to the West.

At a time when overworked Russian police are hard-pressed to cope with a steep rise in burglaries, car thefts and other property offences, violent crimes have also increased dramatically. The number of reported murders across Russia jumped from 13,543 in 1989 to 29,213 last year—a homicide rate of 20 per 100,000 people, one of the world’s highest. (Canada’s murder rate in 1992 was 2.7 per 100,000; New York City’s was 27.) Mob-linked contract killings have become especially popular—accounting for a reported 250 deaths last year, twoand-a-half times as many as in 1992.

Not surprisingly, opinion polls suggest that crime is second only to economic survival as the chief preoccupation of Russians. Under communism, muggings and other types of crime that afflict major Western cities were relatively rare in Moscow. Now, most of the city’s nine million residents are worried about their personal safety, afraid that they will be injured or killed by street gangs or robbers. To some Russian biznesmenyi, in fact, using force is simply the most efficient way of solving a problem. Said Interior Minister Viktor Yerin: “Violence is increasingly becoming a method to exert pressure on administrative officials and a means to coerce or remove business rivals.”

Adding to the public’s frustration is a more traditional Russian problem: official corruption. These days, that can range anywhere from police shakedowns of motorists—typically, an officer might overlook a minor traffic violation in return for a $3 bribe—to demands for huge bribes by highly placed government officials. Earlier this year, a group of economic advisers bluntly warned Russian President Boris Yeltsin that if he failed to make crime fighting his government’s top concern, disen-

chanted voters would tum in increasing numbers to right-wing demagogues such as ultranationalist leader Vladimir Zhirinovsky. Among Zhirinovsky’s pet solutions for restoring law and order: the introduction of summary executions for high-level mobsters.

High-income Russian athletes are particularly vulnerable to mob pressure. The head of the Russian Ice Hockey Federation, Vladimir Petrov, acknowledged at the World Hockey Championships in Italy this month that extortion was a problem faced by many of his players. In March, Buffalo Sabres right-winger Alexander Mogilny complained to police that a fellow expatriate, Sergei Fomitchev, who had helped him defect five years earlier, had threatened to shoot or stab him if he did not

hand over $150,000 in protection money. Fomitchev, who insisted that he was only trying to borrow money from the hockey star, pleaded guilty in Buffalo last month to a reduced charge of menacing. He is due to be sentenced this week.

Unlike Mogilny, most NHL players from the former Soviet republics refuse to talk openly about the problem, although many admit off the record that they have paid protection money to discourage attacks against their relatives back home. For their part, officials of the NHL Players Association say that there is little they can do because, as they see it, there is no credible law enforcement in Russia. “There is no order over there right now,” association boss Bob Goodenow told Maclean’s last week. “And until there is, there is no way that we can exert any influence to stop the thugs.”

One target that offers nightmarish possibilities for criminal power and profits is the former

Soviet nuclear arsenal. In 1991, Greenpeace activist William Arkin demonstrated the arsenal’s shocking vulnerability when he secretly negotiated with Soviet soldiers stationed near Berlin to buy a nuclear warhead for $330,000. The plan failed—but only because Soviet authorities abruptly withdrew all of their nuclear weapons from Germany when an abortive coup erupted in Moscow in August of that year. In 1993, Western intelligence reports say, Russian security agents seized 60 kg of highly enriched uranium—enough to build three weapons as powerful as the bomb that devastated Hiroshima—and later arrested several people on smuggling charges. Meanwhile, German police arrested several men from the former Soviet republic of Kazakhstan who had smuggled nuclear fuel as well as beryllium and zirconium—two rare metals used to build nuclear weapons—from their homeland to the West.

In both Russia and Kazakhstan, authorities continue to deny that nuclear warheads and weapons-grade fuel have been smuggled out of the former Soviet Union. They also dismiss reports that gangsters have stolen some of the 15,000 tactical nuclear warheads that are now in storage, supposedly protected by demoralized and impoverished soldiers. But even in defence circles, no one knows exactly how many warheads and other nuclear weapons are scattered across the region. Most are now in Russia, but the breakup of the former nuclear superpower has made precise record keeping impossible. As well, a high-ranking official at Russia’s ministry of atomic energy recently acknowledged that even decommissioned weapons still pose a threat. Said Alexei Lebedev: “We are troubled by the fact that dismantled plutonium is being stored at interim storage centres which are not well| guarded. You cannot guarantee against g stealing or misuse of the material.” s In any event, criminal control of nu§ clear weapons would surprise few people Q in a country where the tight controls of a totalitarian system have withered away. In the city of Tver, 170 km northwest of Moscow, informants among the region’s highway patrolmen often tip off local criminals whenever trucks loaded with valuable cargo pass through traffic checkpoints. Gangs also control the city’s many sidewalk kiosks. Before granting new permits, licensing authorities routinely check to ensure that the applicant has been approved by one of the local godfathers.

So pervasive is official corruption that Filippov is currently urging Yeltsin to form a new national police force that would have wide powers to fight crime—but which would not accept recruits from existing security forces. After all, if things get any worse, even legislator Skorochkin might feel tempted to accept a return to his country’s traditional method of curbing crime: authoritarian rule.

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